Let Valuation Tech Help Improve Your Collateral Valuation

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Talking proptech with FinLedger Director Holden Page

In this episode, Page discusses the hottest topics coming across FinLedger’s news desk. Topics include: the online banking market, what’s happening in the proptech space and recent private market deals.

With a reinvigorated CFPB, what’s next for the NYDFS?

While the CFPB is reinvigorated under the Biden administration, there’s plenty of room for it to retake a leading role and coordinate with the NYDFS.

Does your CRM hurt or help the customer experience?

In real estate, data is king. The more you leverage your own data the better off your agents or loan officers will be because they’ll be able to identify, target and create better customer experiences.

Mortgage

Lack of millennial homebuyers drags on housing

Veros: Prices, credit reduce first-time homebuyers

While the percentage of residential markets expected to increase in value over the next 12 months has remained steady, dipping slightly to 82% from last quarter’s 83%, the decreasing number of first-time homebuyers is influencing market softening. 

That’s the consensus from Veros Real Estate Solutions.

The national forecast remains at +2.4% annual appreciation, consistent with the previous VeroFORECAST rate.

It is the 10th consecutive quarter in which the index has shown forecast appreciation, but the pace has continued to slow.

The percentage of first-time homebuyers has dropped to 33%, down significantly from the long-term national average of 40% (dating back to 1981), a 27-year low.  Tighter lending restrictions, such as large cash down payment requirements, and increased housing prices are causing millennials to be reluctant about jumping into the market. This, in conjunction with investors shifting out of buying homes in many markets due to higher prices, is delivering a double-blow to some markets.

“While we are seeing a worrisome drop in first-time homebuyers, there are policy changes being put into place with the intent to move the needle on the growth of this particular homebuyer, specifically with the GSEs' new policy of 97% LTV,” said Eric Fox, Veros’ vice president of statistical and economic modeling.

Fox notes that despite this single variable, there is stability in the market. 

“Although the market overall is expected to be healthy with most markets appreciating, the level of forecast appreciation is certainly lower than forecasts three or four quarters ago,” Fox said.

Housing supply and unemployment rates continue to be major influencers in the national market appreciation and depreciation forecasts. 

“We are seeing housing supplies down anywhere from 35% to 70% in our top markets. Low unemployment rates and population growth are driving housing prices upward,” he says. “Conversely, where unemployment rates exceed the national average, the result is increased housing supply and waning population trends, causing a forecasted decline in those areas. Similar to last quarter's forecast, the bottom performing markets continue to be in the eastern part of the nation."

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